|Sportstar Aces Awards 2023 | VOTE FOR TOP CATEGORIES

Global stocks slip as U.S. inflation hits 40-year high

‘U.S. price-rise is a story of overheating’

February 12, 2022 04:02 am | Updated 04:02 am IST - London

File

File

European stock indices fell on Friday and the U.S. 10-year yield held close to 2% after red-hot U.S. inflation led investors to expect tighter monetary policy from the Federal Reserve.

U.S. consumer prices rose 7.5% last month, the biggest annual increase in 40 years, data showed on Thursday. The news fuelled speculation that the Fed will raise rates by 50 basis points in March, rather than 25.

Wall Street stocks fell after the data and the weakness continued through the Asian and European sessions on Friday. Europe’s STOXX 600 was down 0.9%.

“Real inflation is not under control,” said Matteo Cominetta, senior economist at Barings Investment Institute. “It’s a story of overheating, plain and simple,” Mr. Cominetta added.

“You have all these cost-push factors on one side and then you’ve got booming demand hitting this constrained supply — it’s very hard to see how inflation could slow down anytime soon in the U.S.,” he said.

Top News Today

Comments

Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.

We have migrated to a new commenting platform. If you are already a registered user of The Hindu and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.